Obama Privatizes

Barack Obama told supporters this morning that he’ll be forgoing more than $80 million in public funds for the general election, making him the first major party nominee to reject the taxpayers’ grant since the program began in 1976. Obama called the system “broken” and said he will instead rely on small donations to land him in the White House. “Instead of forcing us to rely on millions from Washington lobbyists and special interest PACs, you’ve fueled this campaign with donations of $5, $10, $20, whatever you can afford,” Obama said in a video message on his website.

Last March, before Obama became the candidate to beat in the money race, his campaign said he would “aggressively pursue an agreement with the Republican nominee to preserve a publicly financed general election” if he were to win his party’s nomination. Although opponent John McCain has indicated he’ll accept public funding, Obama’s now arguing that running a campaign based on small contributions accomplishes what the public financing system aims to do but falls short of doing: curb the influence of outside interest groups.

But the taxpayer-financed system, administered by the Federal Election Commission, and Obama’s chosen path diverge in significant ways. Obama’s campaign isn’t built entirely on small donors–about 55 percent of his total haul so far has come from big donors (those giving more than $200), CRP has found. In addition, for the first time since George McGovern faced off against Richard Nixon, the two major candidates will compete on a playing field that is financially uneven. With less than 10 percent of taxpayers traditionally dedicating $3 of their tax bill to the program, McCain will face a challenging $84.1 million spending limit once he accepts his party’s nomination at the GOP’s summer convention, while Obama will be free to spend whatever he can raise. Just through April, Obama had raised more than $265 million since the start of his campaign last year, $8.8 million of which was already earmarked for the general election.

In his announcement this morning, Obama also criticized McCain, who helped craft a sweeping campaign finance reform bill in 2002, saying that the Republican’s campaign is “fueled by contributions from Washington lobbyists and special interest PACs.” McCain has received more than $650,000 in contributions from the lobbying industry, while Obama has pledged not to accept lobbyists’ money. A mere 1 percent of McCain’s contributions have come from PACs, which tend to play a greater role in congressional elections. Obama also suggested that McCain hasn’t done enough to curb the role of outside issue groups, known as 527s, which can accept unlimited contributions to run issue ads that often strongly suggest support or opposition for a candidate (it’s illegal to overtly do so).

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Viveca Novak
(202) 354-0111
press@crp.org

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